The small print, obligatory for the franchisee?
In many franchise formulas, the franchisee is obliged to use the contacts put forward by the franchisor, such as a permanent supplier or permanent adviser. Because that regular supplier or consultant will often apply its own general terms and conditions, these terms and conditions are more or less imposed on the franchisee. This is not necessary.
They are often referred to as the ‘small print’: the general terms and conditions used by suppliers, banks, insurers, and so on. The conditions are often printed almost unreadably small on the back of a contract or quotation. And while everyone knows that the ‘small print’ is important, they are rarely read properly.
Nevertheless, it is very important to carefully read the general terms and conditions that the other party declares applicable when concluding a contract. Although the law offers some protection against unreasonably onerous provisions, that protection mainly applies to consumers and not to people acting in the course of a business.
The franchisee can always make agreements with any contracting party that deviate from one or more provisions of the general terms and conditions of this party. After all, freedom of contract also applies in this relationship. It is only a matter of reading the terms and conditions carefully. You can submit all provisions that you find and that you do not like to the contracting party. Ultimately, by negotiating this, you can arrive at a set of general terms and conditions that is acceptable to both parties.
An example to underline the importance of negotiation:
Suppose your supplier’s general terms and conditions state that a specified delivery date is never a deadline. In your industry, however, you regularly make agreements with your customers, which must be kept on time. If you are late, your customers will incur damage that they may be able to recover from you. It is then advisable to change the general terms and conditions with the supplier in such a way that the delivery date stated to the supplier is a strict deadline, unless it has been expressly stated that this is not the case.
Ludwig & Van Dam franchise attorneys, franchise legal advice
Other messages
Supermarket Newsletter – 27
Supermarket Newsletter No. 27
Bankrupt because the franchisor refused to sell the franchise company – dated January 28, 2020 – mr. AW Dolphin
The District Court of The Hague has dealt with a request from a franchisor to declare a franchisee bankrupt.
Prescribed shop fitting – dated January 28, 2020 – mr. AW Dolphin
The Midden-Nederland District Court has ruled on whether a franchisee is obliged to carry the shop fittings prescribed by the franchisor.
Ludwig & Van Dam attorneys summon Sandd and PostNL on behalf of the Sandd franchisees – dated 9 January 2020 – mr. AW Dolphin
The Association of Franchisees of Sandd (VFS) has today summoned Sandd and PostNL before the court in Arnhem. The VFS believes that Sandd and PostNL are letting the franchisees down hard.
Article The National Franchise Guide: “Why joint and several liability, for example, next to private?” – dated 7 January 2020 – mr. AW Dolphin
Franchisees are often asked to co-sign the franchise agreement in addition to their franchise, for example. Sometimes franchisees refuse to do so and the franchise agreement is not signed.
Ludwig & Van Dam Advocaten assists Sandd franchisees: Franchisees Sandd challenge postal monopoly in court – dated 12 November 2019 – mr. AW Dolphin
The Association of Franchisees of Sandd (VFS) is challenging the decision of State Secretary Mona Keijzer to approve the postal merger between PostNL and Sandd before the court in Rotterdam.